Daily Gold Update

Source: Bill Musgrave, American Gold Exchange

AustinNew York gold rose 0.3% to close near $2,571 before the Fed's momentous decision on interest rates. Gold futures then jumped as high as $2,610 in after-hours trade after the central bankers delivered a jumbo rate cut, pressuring the dollar and lifting alternative stores of value. Silver slid 1.1% to finish at $30.34 an ounce.

At the end of its two-day meeting on monetary policy the Federal Reserve cut interest rates by 50 basis points, the most in 16 years. It was a bold move, one that had been discounted by most economists leading up to the meeting, given the Fed's history of taking small steps.

In the accompanying statement, the FOMC said it has "greater confidence that inflation is moving sustainably toward 2%. The vote was nearly unanimous, with only a single member calling for a quarter-point cut. Policy makers anticipate another half-point in reductions before year end, according to their forecasts.

The dollar lost 0.5% against major rivals after the rate decision, lifting gold by making it less expensive in other currencies.

Most analysts see the Fed's pivot as bullish for gold as it lowers Treasury yields and weakens the dollar. Aakash Doshi, head of commodities, North America at Citi Research is forecasting gold at $2,600 by the end of 2024 and $3,000 by the end of 2025.

Platinum and palladium fell 0.8% and 3.4%, respectively.

At the New York spot close: gold gained $6.40 to $2,570.70; silver slid 34 cents to $30.34; platinum lost $8 to $974.80; and palladium retreated $39.20 to $1,066.50 an ounce.